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Solid Waste: loss of capacity payments forces reserve use and a phased tipping‑fee increase
Summary
Solid waste leaders told commissioners the December expiration of the power‑purchase/capacity agreement removed a major recurring revenue stream; the department is brokering power sales on the spot market while using reserves and a proposed phased tipping‑fee increase to replace lost revenue
Solid Waste officials briefed the Board on FY26 after the December expiration of the prior power‑purchase agreement and capacity payments.
James Lewis (OMB) summarized that revenue from the power buyback and capacity payments fell from $77 million (FY24 actual, the year that included full capacity payments) to far smaller electricity sales in FY25 and that FY26 must rely on market brokering and reserve drawdowns. Solid Waste officials told commissioners they have begun brokering electricity on the open market; early results have been variable and staff recommended a conservative FY26 revenue assumption for brokering.
Because the capacity payments that underwrote the prior revenue are gone, solid waste has also proposed a multi‑year approach to raising municipal and commercial tipping fees. Staff proposes increasing municipal/commercial tonnage tipping fees by 8% in FY26 (from $54.50 to $58.86 per ton) as the first step in a planned three‑year increase designed to stabilize finances while the department develops longer‑term facility plans. Passenger vehicle and truck/van unit fees would remain flat.
Why it matters: The previous capacity payments were a significant, recurring revenue item. With those payments gone, solid waste faces a structural revenue shortfall and needs to use reserves and fee increases to fund operations and capital, including projects such as a bulky‑waste processing facility and waste‑to‑energy plant renewals.
Solid Waste staff also discussed new capital work: a bulky‑waste processing facility concept, active landfill gas collection improvements and energy projects aimed at producing more usable on‑site generation. The department said it is negotiating a new operations contract for the county’s waste‑to‑energy facility and will present procurement results later in the year.
Ending: Commissioners heard the request and asked for details about the proposed fee changes and outreach to municipal and commercial partners before final adoption. No final vote occurred at the briefing.
